Hudson Technologies, Inc.

Good evening, ladies and gentlemen, and welcome to the Hudson Technologies third quarter 2026 earnings conference call. All lines have been placed on listen-only mode, and the floor will be opened for your questions and comments following the presentation. At this time, it is my pleasure to turn the floor over to your host for today, Jennifer Belladeau of IMS Investor Relations. Please go ahead. The floor is yours.

Thank you. Good evening, and welcome to our conference call to discuss Hudson Technologies' financial results for the third quarter of 2026. On the call today are Ken Gaglione, President and Chief Executive Officer, and Brian Bertaux, CFO. I'll now take a moment to read the Safe Harbor Statement. During the course of this conference call, we will make certain forward-looking statements. All statements that address expectations, opinions, or predictions about the future are forward-looking statements. Although they reflect our current Expectations and are based on our best view of the industry and of our businesses as we see them today. They are not guarantees of future performance. Please understand that these statements involve a number of risks and assumptions, and since those elements can change and in certain cases are not within our control, we would ask that you consider and interpret them in that light. We urge you to review Hudson's most recent Form 10-K and other subsequent SEC filings for a discussion of the principal risks and uncertainties that affect our business and our performance and of the factors that could cause our actual results to differ materially. With that out of the way, I'll turn the call over to Ken Gaglione.

Good evening, and thank you for joining us to review our third quarter results and the progress we are making to position Hudson for sustained long-term growth. Third quarter revenue and volume fell below expectations as ample channel inventory kept HST market prices low. In this soft pricing environment, Hudson elected to concentrate on profitable sales and cost reductions to deliver gross margin that exceeded expectations. I am pleased with our strong 9% year-to-date sales volume increases and meaningful progress made on strategic initiatives designed to strengthen margins, expand capabilities, and create shareholder value. Of note this period, EPA released data showing that U.S. HFC inventory declined 3% year-over-year in 2025, the latest data available. Although the channel inventory decline was less than expected, and we believe it is a meaningful contributing factor in the continued weakness in 410A pricing, the long-term trend remains clear. In 2022, when the AMAC took effect through 2025, reported total HFC inventories have declined approximately 27%, and reclamation is expected to become an increasingly important domestic source of refrigerant supply. At current levels, channel inventories could continue to moderate pricing and demand for reclaimed refrigerant as the industry approaches the next phase down in 2029. However, we also see several factors that may create demand beyond earlier projections, including the continued use of HFC components in certain next-generation HFO blends. opportunities in new markets, such as data centers, and the potential for future adjustments to tighten the HFC allowance framework to keep the AIMS Act phase-down objectives on track. Additionally, certain state policies are creating early demand for reclaimed product. For example, both California and New York have regulations taking effect in January 2027 that require the use of certified reclaimed refrigerant in certain automotive applications. We will continue to take advantage of these and other opportunities as early adopters prepare for the 2029 phase down. As noted separately, we signed a joint development agreement during the quarter with Icorium, a Kansas-based company specializing in next-generation technology for mixed refrigerant separation. The agreement gives Hudson dedicated access to advanced engineering resources and technology, first-mover advantages during the initial commercialization period, and create the path to expand our separation capabilities and capacity. This patented extractive distillation technology is expected to complement our existing fractional distillation systems by processing complex refrigerant mixtures, including those difficult next-generation blends and azeotropes, with greater speed, recovery, and efficiency. If successfully commercialized, this technology will help convert more recovered refrigerant into saleable product reduce destruction and inventory days on hand, improve working capital efficiency, and lower our reliance on virgin refrigerant. Because the technology enables the separation of mixed refrigerants, it may also make refrigerant recovery more convenient and economical for contractors who will be able to combine the refrigerants they recover into one cylinder rather than sorting by product type into several cylinders. This small adjustment can have a big impact and help reduce the friction at the point of recovery and support higher industry recovery rates. We believe the broader industry can benefit from this partnership while also strengthening Hudson's cost position and enabling us to establish a differentiated technology-enabled platform for refrigerant recovery, purification, and separation services. Also noteworthy, in August 2026, Hudson was re-awarded the $210 million DLA contract. The award extends this important strategic relationship for five years through July 2031, with the opportunity for an additional five-year extension through July 2036. During the third quarter, the DLA contract contributed $11 million in revenue. We are continuing to optimize our D365 ERP platform and Robert Gaglione, Robert Stoody. and Grogh in higher value reclaimed and specialty refrigerants to support core customer requirements. This approach allowed us to strengthen our cash position in the quarter, providing us the financial flexibility to continue investing in our strategic priorities. As we move forward through the fourth quarter and prepare for 2027, we will continue strengthening our core capabilities to support the growth strategy. Our priorities include advancing the new separation technology and making disciplined investments in our facilities, operating efficiency, talent acquisition, and market development. Taken together, we are managing market forces beyond our control while building a more resilient, higher-value business designed to reduce our future exposure to short-term refrigerant price fluctuations. Now I'll turn the call over to Brian. Brian, please go ahead.